The Morgan Hill City Council July 20 unanimously approved a resolution declaring the need for $38 million worth of bonds. The vast majority of the funds, if approved by voters through a possible ballot measure in November, would be used to pay for street repairs, upgrades and maintenance, according to city staff.
The resolution is a precursor to placing the bond measure or a similar local funding mechanism on the Nov. 8 ballot. At the July 27 meeting, the council will consider placing the bond measure—which would be paid back by a parcel tax on local property owners—or a local sales tax on that ballot, allowing the voters to decide whether to tax themselves.
Councilman Gordon Siebert was surprised that no members of the public spoke at the July 20 public hearing on the bond resolution. He added that if he and his colleagues approve a ballot measure next week, he hopes they hear plenty of community feedback and input.
If voters approve the bonds, the money would be spent gradually by the city over a 30-year period, according to Morgan Hill Assistant City Manager for Administrative Services Christina Turner. Eighty percent of the $38 million—about $30.4 million—would be dedicated to street repair and replacement. Another 10 percent—about $3.8 million—would go toward parks and 10 percent toward public facilities.
Turner added these numbers—which were based on a 2014 consultant’s study on the condition and needs of the city’s infrastructure—are subject to change.
City officials have long decried the shortage of funding to maintain Morgan Hill’s network of roads and streets, and warned of the need for a new source of finances. The city currently faces an annual funding shortfall of about $5.8 million to maintain streets at their current condition.
City Manager Steve Rymer added July 20 that current “deferred maintenance” on city streets will cost about $20 million in catch-up expenses. That price will continue to rise as long as the maintenance continues to be delayed.
If voters approve the $38 million worth of general obligation bonds, Morgan Hill property owners would repay the debt with a parcel tax of $29 per $100,000 of assessed property value. That amount would gradually go down as the city pays off the bond, Turner explained to the council.
Alternatively on July 27, the council could approve a local sales tax for similar purposes, and primarily for roads and streets. Over the last few months, the city and consultant Godbe Research have been conducting surveys of residents to determine their priorities for their city government, and their likelihood of voting for a local sales tax or bond measure. The latest results of those surveys will be presented to the council July 27, according to a city staff report.
The latest survey asks potential voters, among other questions, whether they would support a three-quarter-cent, half-cent or quarter-cent sales tax, according to Morgan Hill Communications Manager Maureen Tobin.
